On Thursday, April 9, spot gold climbed nearly 1%, supported by a decline in the U.S. dollar and Treasury yields. Investors are focused on whether the fragile cease-fire agreement involving Iran will hold, along with the upcoming U.S. CPI report due Friday.

Spot gold closed up $46.46 at $4,765.45 per ounce. In the previous session, the metal had touched a near three-week high.

FXStreet analyst Christian Borjon Valencia noted that gold resumed its upward trend on Thursday after Israeli Prime Minister Benjamin Netanyahu expressed openness to negotiations with Lebanon. This factor, combined with broad-based dollar weakness, supported gold and pushed it higher, challenging the key $4,800 per ounce level.

A softer U.S. dollar made gold less expensive for buyers holding other currencies.

The rally continued as falling U.S. Treasury yields enhanced gold's appeal as a safe-haven asset. The yield on the 10-year U.S. Treasury note fell 2 basis points to 4.279%.

Bob Haberkorn, Senior Market Strategist at RJO Futures, stated, "The dollar's pullback has helped gold regain its footing, but market participants are still cautiously interpreting the meaning of the cease-fire. The news of the cease-fire was very positive for gold, but prices have retreated from recent highs as cracks appear."

This follows a significant escalation on Wednesday, when Israel intensified attacks on Hezbollah strongholds in Lebanon. Iran has insisted that any cease-fire must include Lebanon.

A turning point emerged on Thursday, one day after Israel launched its largest attack in Lebanon to date, resulting in over 300 casualties. Prime Minister Netanyahu stated that Israel is seeking direct talks with Beirut. Netanyahu said the negotiations would "focus on disarming Hezbollah and establishing peaceful relations between Israel and Lebanon."

The United States is intensifying diplomatic efforts to end the conflict. A U.S. delegation led by the Vice President is scheduled to travel to Islamabad, Pakistan's capital, for a new round of talks aimed primarily at ending the hostilities. Disagreements persist between Iran, the U.S., and Israel regarding the scope of the cease-fire, particularly whether it should cover Israeli military actions against Iran-backed forces in northern Lebanon.

**Israeli Prime Minister's Significant Remarks Boost Iran Cease-Fire Prospects**

The U.S. dollar declined on Thursday as prospects for an Iran cease-fire improved after Israel and Lebanon agreed to negotiations, removing a key point of contention related to Iran.

The U.S. Dollar Index (DXY), which tracks the currency against a basket of six major counterparts, fell 0.4% to 98.82.

Israel conducted further strikes on targets within Lebanon; Tehran accused the U.S. and Israel of violating agreements and stated that continuing peace talks under these conditions was "unreasonable."

These actions fueled market concerns about the sustainability of the Iran cease-fire, boosting demand for safe-haven assets and initially providing support for the dollar. However, the situation shifted following the latest comments from Prime Minister Netanyahu.

Netanyahu said on Thursday, "In light of Lebanon's repeated requests for direct negotiations with Israel, I have instructed the government to initiate such talks as soon as possible during yesterday's meeting."

Netanyahu added, "The negotiations will focus on disarming Hezbollah and establishing peaceful relations between Israel and Lebanon. Israel also views positively the call made today by the Lebanese Prime Minister for the demilitarization of Beirut."

José Torres, Senior Economist at Interactive Brokers, commented, "Amid growing market skepticism about the U.S.-Iran cease-fire deal, Wall Street was taking a breather from a prolonged rally until Israel's agreement to talk with Lebanon triggered a strong intraday reversal in stocks and bonds. It was the conflict between these two countries that had initially sparked concerns about the durability of the Iran agreement."

In a Thursday interview, U.S. President Donald Trump stated that he had asked Israeli Prime Minister Netanyahu to be "more low-key" in military operations in Lebanon to align with U.S. diplomatic efforts to secure a cease-fire with Iran.

Trump said he had spoken with Netanyahu, who agreed to "reduce the intensity of operations" and indicated that Israel was "scaling back" its military actions in Lebanon. This follows reports that Trump, during the call, urged Israel to decrease strikes on Lebanon and engage the Lebanese government in talks about disarming Hezbollah.

**Focus on U.S. CPI Data**

Beyond the Middle East situation, markets are also awaiting the release of the U.S. Consumer Price Index (CPI) for March on Friday.

Data released on Thursday showed the Personal Consumption Expenditures (PCE) price index, the Federal Reserve's preferred inflation gauge, rose 2.8% year-over-year in February, matching expectations, with a potential further increase possible for March.

Prominent investment bank Morgan Stanley anticipates gold prices will remain stable in the second quarter before rebounding in the second half of the year.

Morgan Stanley noted, "If the Fed refrains from raising interest rates, we believe gold could rally. A resolution to the conflict would also be supportive, potentially refocusing attention on fiat currency debasement concerns."

**Gold Technical Analysis**

FXStreet analyst Christian Borjon Valencia pointed out that despite forming a "shooting star" pattern on Wednesday, gold is now showing signs of recovery. However, bulls still have some distance to cover before reclaiming the next key resistance level—the intraday high of $4,857 per ounce reached on April 8. The Relative Strength Index (RSI) suggests bullish momentum is building as the indicator climbs above the neutral 50 level.

Valencia stated that, consequently, if gold successfully reclaims the $4,800 per ounce level, traders might attempt to test $4,857, with sights set next on the psychological $4,900 mark. A further potential upside target lies at $5,000 per ounce.

Valencia added that conversely, if prices fall below the 20-day Simple Moving Average (SMA) at $4,690, it would open the door for a challenge of the 100-day SMA at $4,656. Below that level lies the intraday low of $4,553 recorded on April 2.